Question
On 15 February, Epick's Sales and Marketing Manager, Krystal Ball, comes to see you, she has a problem that she needs your advice on. Major
On 15 February, Epick's Sales and Marketing Manager, Krystal Ball, comes to see you, she has a problem that she needs your advice on. Major Australian games developer Kronos, based in Melbourne, is developing a new action game called "Fought Knight" based on medieval battles. Kronos had put out a request for tenders to do the software development work for the beta version of the game as well as handover and training to Kronos staff and support during the beta market testing stage. Krystal gives you a copy of the Conditions of Tendering that Kronos gave to Epick early in January. She also gives you a copy of the costings worksheet that Finance Manager Holden Cash prepared on 5 February that also contains a copy of the Tender that she submitted on 9 February to Kronos. Clearly the project is a lucrative one and Krystal tells you that the income from this first major contract for Epick will pay for computers that will be used for other projects too so it represents a great start to the year. It also will be used to pay Cody's entire salary for 1 year even though he will work on many projects. However, Krystal is concerned that Epick may have overpriced the project at $853,072 (incl. GST). She has heard through the grapevine that other tenderers are submitting quite a bit below Epick's price. Rather than risk being seen as way over-priced, which may jeopardise Epick's fledgling reputation, Krystal wonders if it might be worth simply withdrawing Epick's tender. Krystal has also heard that one of Epick's competitors Awesome Games submitted a tender to Kronos on 12 February. Krystal asks you to consider the Conditions of Tendering and answer the following:
a) If Epick decides to do so, can it withdraw its tender prior to the assessment date of 20 February?
b) Will Epick's tender be unsuccessful regardless because Kronos is bound to accept the lowest priced tender?
c) If Awesome Games were to win the tender, would Epick have any claim against Kronos regardless of whether or not Epick would have won the tender?
Using the 4-Step Approach with reference to relevant principles and cases, answer Krystal's questions.
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